SECI cancels 2,000 MW wind tender as infra woes keep bidders away

Industry experts said constraints on transmission capacity are proving to be key risk across all renewable technologies.

Solar Energy Corporation of India (SECI) has cancelled a recent 2,000 megawatt wind power tender, which was undersubscribed, owing to lack of sufficient transmission infrastructure, officials aware of development said.

“We have decided to cancel the tender since the response was not good,” a senior government official told ET. “The bid was undersubscribed by 800 MW, so we couldn’t have gone ahead with it.” SECI managing director Jatindra Nath Swain did not comment.

Four developers — Renew Power, Adani Green Energy, Sprng Energy and Alfanar Energy — had submitted technical bids for a capacity of 300 MW each at the auction last month. SECI had tendered the interstate transmission-connected 2,000 MW capacity under Tranche-V in May.

Renewable energy developers have, for long been complaining about lack of power evacuation infrastructure at their disposal. Key renewable locations like Gujarat and Tamil Nadu face huge transmission constraints and developers are not getting connectivity despite completing their projects.
The official quoted above, however, said that in a recent meeting with Power Grid Corporation, transmission issues related to the previous wind tenders have been resolved.

“The transmission issues have largely been sorted out during subsequent meetings with PGCIL. We now have the Tranche-VI wind tender for 2,500 MW capacity, and we will go ahead with that,” the official said.

The tender did not reach the price bid stage, as tariffs would have been uncompetitive and on the higher side.

“If the tender has not been fully subscribed, there is no point holding the price bids because developers can quote whatever tariff they want and there is no competition. Eventually it would be cancelled,” another official said on the condition of anonymity.

Industry experts said constraints on transmission capacity are proving to be key risk across all renewable technologies. “In case of wind power, given its local manufacturing ecosystem, a steady order flow is needed,” said Kameswara Rao, leader—energy and utilities at PwC India. “As we saw last year, tariffs went down when bids were few, and now due to a bunching of bids, tariffs have risen,” he said.

“The government has to set a formal timetable and procuring agencies will need to coordinate better to ensure a proper balance is achieved,” Rao said.

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